Oil prices turned down on Tuesday against fears of rising U.S. production

Brent Crude Oil

"It is likely that the. monthly data will show USA crude oil production in December about 200,000-300,000 bpd above what was estimated in the weekly reports", Petromatrix analyst Olivier Jakob said in a note.

OPEC and its allies, including Russian Federation, have been withholding crude output by 1.8 million barrels a day since the start of 2017.

Birol said he did not see USA oil production peaking before 2020, and that he did not expect a decline in the next four to five years.

U.S. West Texas Intermediate crude for April delivery was up 20 cents, or 0.3 percent, at $63.75 a barrel by 0342 GMT after rising 3 percent last week.

Oil rose on Monday, hitting three-week highs, supported by strong U.S. demand and comments from Saudi Arabia that it would continue to curb production in line with Opec-led efforts.

The April contract LCOc1 settled down 85 cents, or 1.28 percent, at $65.78 a barrel ahead of expiration. So, the price of North sea Brent crude oil on Monday morning, February 26, overcame a mark of 67 dollars per barrel.

Other factors underpinning prices were bullish comments from the Saudi oil minister, who said the country's Q1 output should be below the production cap, a powerful quake in Papua New Guinea, which disrupted oil and gas operations, and a force majeure on Libya's 70,000 bpd El Feel oilfield.

Additionally, gasoline stocks are seen down by 600,000 barrels, while distillate inventories, which include heating oil and diesel fuel, were seen down 700,000 barrels. According to the EIA, the USA will overtake Russian Federation as the world's biggest oil producer by 2019. The most active US gasoline futures RBc2 fell as much as 3.1 percent to $1.9354 a gallon.

Although of course this is a drop in the bucket compared to powerhouse output elsewhere in the world, it demonstrates how quickly a country whose crude industry was thought to have been in permanent decline can stage a comeback - and it also reinforces the notion that western nations, along with many OPEC members, are eager to extend their production capabilities regardless of the shaky global supply and demand balance.

"There is ongoing pressure, largely coming from a stronger US dollar", said Michael McCarthy, chief market strategist at CMC Markets in Sydney. More reliable monthly figures are due later in the day, and analysts expect that report to show another large upward revision.

American explorers have expanded the fleet of rigs searching for domestic crude to the highest since 2015 as the Opec-led supply curbs resurrected oil markets. While Canadian production has continued to rise, reflecting past investments, pipeline capacity constraints have limited producers' options for moving their products to USA markets.

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